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Flash PMIs Flag Eurozone Contraction, Japan and India Factory Strength, UK Cost Spike

A war-driven jump in energy and shipping costs is reviving inflation risk for economies already seeing weaker services.

A woman stands next to debris lying in front of a residential building damaged by a strike on March 4, in Tehran, Iran, April 14, 2026. REUTERS/Thaier Al Sudani/File Photo
People wait in line outside a restaurant in Paris, France, October 26, 2025. REUTERS/Jeenah Moon
Shipping containers are stacked at a terminal at the port of Los Angeles in Long Beach, California, U.S., March 10, 2026. REUTERS/Caroline Brehman/File Photo
People hold a patio umbrella in a strong wind outside a restaurant in Berlin, Germany February 17, 2022. REUTERS/Michele Tantussi

Overview

  • Flash PMI reports released Thursday showed the eurozone slipping back into decline even as Japan and India posted strong factory gains.
  • The eurozone composite index fell to 48.6 as services dropped to 47.4, while manufacturing rose to 52.2 on clients bringing purchases forward.
  • Japan’s manufacturing PMI jumped to 54.9, a four‑year high, as firms lifted output to guard against supply risks tied to the Middle East conflict.
  • India’s composite PMI climbed to 58.3 with hiring at a 10‑month high, and companies built inventories to hedge against shortages and rising input costs.
  • Cost pressures surged, with eurozone input prices at multi‑year highs and a record month‑to‑month jump in the UK, raising a hard trade‑off for central banks.